Labour Market Policy Measures Research Articles

Non‐standard employment, low standard of living? The role of labour market and social policy measures in preventing material deprivation in different employment trajectories in Europe

AbstractWhile the poverty risks of non‐standard employment have been explored extensively, this study focuses on the role of activation‐oriented social policy in alleviating material deprivation for persons with non‐standard employment histories. Using EU‐SILC data, individuals over a four‐year period were analysed. I focused on substantial earners and distinguished between six non‐standard employment histories expected to benefit from activation measures. Multi‐level models revealed that compared to standard employment histories, all non‐standard employment histories had higher material deprivation risks but to substantially different extents. At the macro level, participation in activation measures, expenditures in formal childcare and minimum income protection reduced material deprivation. Participation in training can be interpreted as an equaliser, as the deprivation gap between standard and most non‐standard employment history types diminished. As expenditure‐ and participation‐based measures differed significantly, evaluating the success of activation strategies in reducing inequalities and alleviating poverty highly depends on the measurement of activation.

Active Labour Market Policies for Rural NEETs in Lithuania: A Case of Rural Municipalities

This article aims to analyse active labour market policy efficiency for rural young NEETs integration into the labour market in the socioeconomic context of rural municipalities in Lithuania. For the empirical analysis, the administrative data of the public employment service concerning active labour market policy measures, e.g., training and mobility support, subsidised employment, and support for establishing or adapting workplaces of 2018 and 2022, as well as Lithuanian statistics data of 2018 and 2020 are used. The socio-economic environment of rural municipalities was analysed using the economic indicators (complex index), public transport accessibility, average wage, and free vacancies indicators. The recipient’s integration into employment after six months of participation in active labour market policy measures is analysed. The data revealed poor economic indicators, undeveloped public transport, lower average salaries, and a need for more vacancies in rural municipalities. The integration into employment fell significantly in two rural municipality clusters after the Covid-19 pandemic.

Do individualised projects help integrate the long‐term unemployed and disadvantaged people? Lessons from the Czech Republic

AbstractThis article evaluates a national project for the integration of long‐term unemployed and disadvantaged groups of jobseekers implemented in the Czech Republic since 2019. It discusses how individual work and active labour market policy measures for these groups have changed, and what the outcomes were. We combined a quantitative evaluation of the targeting and outcomes of the measures with a qualitative evaluation of changes in the project implementation through semi‐structured interviews and focus group discussions conducted at the Labour Office branches. The findings show the need to broaden the availability of hard measures such as private‐sector placement subsidies for the most disadvantaged jobseekers, and to improve soft measures (counselling and training), especially if front‐line workers do not have sufficient competences for individual work. We are cautious about generalising the findings, as the pandemic complicated the implementation of soft measures.

Age-Related Differences in Job Search Behavior: Do Older Jobseekers Need a Larger Social Network?

Abstract Increasing the employment rate of individuals aged 55+ is a key challenge in many OECD countries. While labor market discrimination and policy measures have been put forward as possible explanations, the role of job search remains largely unexplored. Yet, it determines to a large extent the match between supply and demand on the labor market. In this paper, we examine age-related differences in job search behavior. As skills have often become outdated for older workers, but job mobility may enhance their employment, we analyze search behavior for the unemployed as well as the employed adopting multiple parameters: job search intensity, use of the public employment agency, and social networking. The results indicate that jobseekers of different age employ different search methods, and that this relationship should be analyzed within the employment context of the jobseeker.

Double standard policy: why are immigrants still at the tail of welfare?

PurposeThis research considers the question of whether unemployment insurance benefit and labour-market activation measures induce the likelihood of re-employment and whether this effect differs for natives and immigrants.Design/methodology/approachStatistical processing was carried out on the European Union Statistics on Income and Living Conditions cross-sectional data for Finland for the period 2004 to 2016. Propensity score matching analysis was undertaken to investigate whether a treatment effect (unemployment insurance benefit) was a predictor of success in increasing re-employment rates, when controlling for participation in labour-market policy measures, subsidized employment and personal background characteristics.FindingsWe find that the probability of re-employment for recipients of unemployment benefits is half that of non-recipients of benefits. Due to the influence of subsidized employment, subsequent employment income decreases for recipients of unemployment benefits and especially for immigrants. Finally, we find that due to the influence of subsidized employment, time spent as a full-time employee decreases for recipients of unemployment benefits and especially for immigrants.Originality/valueAlthough our results indicate that benefit determination has a marked impact on re-employment probabilities, unobserved variables turn to play a significant role in selection of labour-market activation measures. In this respect, we find the treatment assignment to activation policy measures depends on influence of unobserved variables and this effect is more important for the re-employment rates of natives than it is for immigrants.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-11-2019-0668.

Allowance for Self-Employed Gainful Activity in Slovakia: A Closer look into the Factors Involved

Abstract Research background: Active labour market policy measures serve to improve the situation with unemployment and the placeability of jobseekers in the labour market. An important tool for the functioning of these interventions is their continuous monitoring and evaluation. Purpose: In this paper, we focus on the Allowance for self-employment gainful activity aimed at providing the financial contribution to start a business. The paper aims to find out those jobseekers’ characteristics that mostly increase the probability of participation in this intervention. Research methodology: We use data from the database of jobseekers of the Central Office of Labour, Social Affairs and Family in Slovakia, the probability model is constructed by a logistic regression. Results: We found several characteristics that significantly impact the decision to participate in the measure. Jobseekers with previous employment in service activities (NACE S), married, long-term unemployed and with a 2nd university degree have a higher chance of participating in this program of the labour market. On the contrary, high age, low education or permanent residence in the Bratislava region decreases the chance for participation in this intervention. Novelty: Knowing the individuals’ characteristics that significantly contribute to the interest in participating in this program can help policymakers set the instrument’s eligibility conditions and allocate funds to increase interest in using this treatment where necessary.

Usluge tržišta rada

The paper analyzes labour market services, as one of the labor market interventions. Labour market services represent all activities of the public employment service and other publicly funded services for jobseekers, which include counseling the unemployed, mediation between workers and employers, informing, monitoring the unemployed and sanctioning in the case of non-compliance, and are considered to be the most cost-effective labour market intervention. Although in recent decades the main focus of labour market policy has been on measures of active labour market policy (such as training or employment incentives), in recent years, with the actualization of the activation concept, labour market services have taken their turn. This paper presents the main features, development, advantages and disadvantages of this intervention in the Republic of Croatia and the opinion of the main actors of this intervention, the Employment Advisors of the Croatian Employment Service. Key words: labour market services, counseling the unemployed, labour market, Croatia.

Labour market policy in Italy’s recovery and resilience plan. Same old or a new departure?

ABSTRACT Liberalizing labour market reforms have topped the agenda of structural reforms implemented in Italy over the last two decades, with detrimental effects on employment quality, wage dynamics and productivity. In 2021, Italy’s then Prime Minister, Mario Draghi, promised that the investments outlined in Italy’s National Recovery and Resilience Plan (NRRP) would ‘transform Italy’s labour market’. How and to what extent does the labour market policy agenda enshrined in Italy’s NRRP deviate from the prior trajectory of policy change? What balance of economic, political and class interests does it reflect? And to what extent does it adequately tackle the long-standing challenges of Italy’s labour market? This article addresses these questions combining in-depth analysis of the labour market policy measures in Italy’s 2021 NRRP and interviews with experts and elites involved in the policy process. Contrary to claims of discontinuity, the findings highlight substantive continuity of the NRRP labour market policy agenda with the prior trajectory of liberalization. The Plan maintains a narrow focus on supply-side labour market interventions – primarily the strengthening of active labour market policies (ALMPs) – without re-regulatory interventions to tackle labour market insecurity or wage stagnation. Exogenous conditionality and domestic political dynamics that systematically advanced the preferences of employer organizations in the design of the NRRP account for the limited extent of policy change. Due to the neglect of demand-side labour market interventions and the uncertainties surrounding the implementation of the ALMP reforms, the transformatory potential of the NRRP’s labour market agenda is likely to remain limited.

ГОСУДАРСТВЕННАЯ ПОЛИТИКА НА РЫНКЕ ТРУДА В СТРАНАХ ЕС: ОСНОВНЫЕ ТЕНДЕНЦИИ И НАПРАВЛЕНИЯ ТРАНСФОРМАЦИИ

The aim of this paper is to determine the prospects for the development of employment programmes in the labour market and the directions for their transformation in the EU countries. The author uses general scientific methods, methods of statistical processing of information, graphical methods, and comparative analysis. The information base of the study includes statistical data and materials of international organizations (UN, ILO, Eurostat, European Commission). The research results: the article presents an analysis of labour market policy measures in the EU countries during periods of sustainable development and economic crises; considers the structure and dynamics of expenditures on various programmes and the number of their participants; identifies the government labour market policy trends and the features of its implementation in countries with developed market economies and in post-socialist countries; presents assessments of the prospects for labour market policies in the EU countries in the face of new challenges. The author concludes about the prospects for labour market policy in the EU countries in the face of new challenges and about the possibilities of using the EU experience in developing active labour market policy measures in Russia. The scope of application: the research results can be used by Russian federal and regional executive authorities in the development of active labour market policy measures.

Lithuanian Active Labour Market Policy in 2009–2020: a Social Investment Perspective

An active labour market policy is an integral part of social policy, ensuring support for the unemployed to search for a job through developing their skills. Thus, the active labour market policy is part of the social investment, focusing on investment in people’s knowledge. The heart of social investment is the design of policy-enhancing people to work, use their skills, create families and grow up children. The active labour market policy was analysed, focusing on the measures and their development in Lithuania. At the same time, the analysis from the social investment perspective was missing. Thus, this research aims to analyse Lithuania’s active labour market policy from the social investment perspective between 2009 and 2020. The choice of the period was determined by the time of the world financial crisis in 2009 and the Covid-19 pandemic crisis in 2020. The analysis of legal documents and Eurostat data for 2009-2018 was used to attain the formulated aim. Additionally, the meta-analysis of the Ministry of Social security and Labour’s Social Reports in 2009-2017 was used to analyse active labour market policy development. The research is based on methodology, which suggests classifying the active labour market measures into the strong and weak investments in human capital. A strong investment provides basic education or training, and a weak one creates new jobs, job subsidies, counselling, services for getting the job, job searching programmes, benefits, and taxes allowances. The analysis of the Lithuanian active labour market policy measures revealed that both strong and weak investments in human capital were balanced only during the crises. However, during the inter-crisis period, Lithuania’s active labour market policy measures were more focused on the weaker investment in human capital measures or the “job first” strategy. The strong investment in human capital was the lowest in Lithuania among other Baltic countries during the analysed period.

Do Disadvantaged Young Adults Benefit Less from Social Investment? Studying Matthew Effects in Activation Measures

Abstract In Germany, social investment can be crucial for disadvantaged young adults, as intergenerational mobility is low and credentials are decisive for employment. However, the literature on policy implementation calls attention to ‘Matthew effects’, by which the most disadvantaged often have the least access to social investment. We contribute to ongoing research on Matthew effects by examining whether the worst-off among young German welfare recipients are assigned to active labour market policy measures that are more advantageous or less advantageous. Findings for a register sample of 20–22 year olds in 2014 support hypotheses that those with the lowest education and employment experience participate less often in the most advantageous measures; particularly in firm-based upskilling and employment assistance, and more often in measures that proved to be not as beneficial, such as workfare programmes. On a positive note, welfare experience during adolescence as an indicator of low socio-economic status in the family of origin does not additionally affect access to social investment policy measures.

Workplace Inclusion Competence and Employer Engagement

Existing active labor market policy (ALMP) measures have been unsuccessful in establishing long- term employment for vulnerable groups.This paper contributes to further development of the role of the employer engagement perspective in ALMP. We introduce the term workplace inclusion competence and explore its association to two distinct work-organizational categories: participa tion- and control-oriented management. We operationalize workplace inclusion competence as inclusion opportunity and inclusion capability. We argue that such competence is dynamic and processual, and find that organizational management-orientation, as well as work pace, employees’ developmental opportunities, financial situation and OSH, have an impact on workplace inclusion competence. Survey data among a sample of managers is analyzed regarding workplaces’ capabilities and opportunities in work inclusion processes. We present two sets of indexes to measure organizational management-orientation and inclusion skills competence. As such, we contribute to the research field by providing new and more specific concepts with adherent question indexes, and by connecting them to a work-organizational perspective.

Protecting livelihoods in the COVID-19 crisis: A comparative analysis of European labour market and social policies

This article provides a comparative study of the labour market and social policy measures introduced in light of the COVID-19 crisis in Denmark, France, Germany, Italy and the United Kingdom between March 2020 and January 2021. Its main aim is to understand whether the crisis response has changed the structures of the welfare states concerned. Focusing in particular on the differences regarding the crisis measures taken for individuals in ‘standard employment’ and ‘non-standard workers’ in each country, it argues that, although extensive temporary protection instruments were introduced for both groups during the crisis, these did not lead to an immediate convergence as regards these groups’ social protection. Rather than changing the underlying structures of welfare systems, many of the measures in fact highlighted the specific vulnerabilities of large segments of Europe’s labour markets. States have, however, granted social compensation at unprecedented levels, which could result in improved infrastructures and a clearer understanding of the responsibility of the welfare state in future emergencies.

Evaluation of the Effects of the Graduate Practice in Slovakia: Comparison of Results of Counterfactual Methods

Graduate Practice is in Slovakia one of the measures of active labour market policy aimed at decreasing the unemployment rate of young graduates. It is one of the most frequently used interventions by young jobseekers under the age of 26; similar measures are used in other European Union (EU) member states. The specific objective of this intervention is to provide young jobseekers to gain the first contact with the labour market, first work experience and work habits that may be attractive to potential employers. The intervention is financed from the European Social Fund (within the Operational Program – Human Resources and the priority axis – Youth Employment Initiative) and the state budget. This fact requires ad 1) to evaluate the eligibility of drawing these resources and ad 2) to evaluate the effectiveness of the use of resources in terms of employability and sustainability of participants of the intervention in the labour market, the second of which is the primary objective of this study. The European Commission has increasingly required the member states of the EU to carry out impact evaluations of funded interventions and to develop evidence-based policies that will implement the results of such evaluations. The aim of this study is, therefore, to evaluate and review the effects of the Graduate Practice on the employability of young jobseekers in conditions of Slovakia. This evaluation is carried out using a counterfactual approach by comparing the results of treated and non-treated individuals by applying the three most used methods: regression adjustment, instrumental variable, and propensity score matching method. The results indicate significant effects of the Graduate Practice on the employability of young jobseekers and their sustainability in employment. The results of the evaluation are valuable mainly for policymakers, i.e. in setting the rules of the intervention and its eligibility to make the measure more effective or potentially in preparing other measures aimed at youth unemployment. Implications for Central European audience: The findings of the evaluation may inspire policymakers in other countries than Slovakia to introduce similar or new programs for the youth unemployed. The results of this study may also be used for an international comparison of the effectiveness of interventions if a similar program for youth unemployed operates in another country, which may be appropriate mainly from the point of view of being a program(s) co-financed by the European Social Fund.

Front-line work in activation and targeting of re-qualification programmes: lessons from the Czech Republic

ABSTRACT A paradigmatic policy change towards activation, together with currently very low rates of unemployment, made the most disadvantaged groups of unemployed people the focus of active labour market policy in the Czech Republic. The aim of including people with multiple and/or severe disadvantages in the labour market represents a new challenge for front-line workers at employment offices, as they are expected to provide their hard-to-place clients with individualised, tailored services, including well-targeted active labour market policy measures. In this paper, we analyse how successful front-line workers are in targeting re-qualification programmes at the most disadvantaged groups and which factors shape front-line work. Our findings are based on recent empirical (quantitative as well as qualitative) research in Czech active labour market policy in which we took part and on in-depth interviews on the topic that we carried out with front-line employment-office employees. We demonstrate failures in personalised front-line activation work and in targeting re-qualification programmes at disadvantaged groups and examine the underlying factors (e.g. governance reforms in activation, insufficient personnel resources, emphasis on coercion and standardisation of front-line work).

Analýza dopadů programu podpory podnikání pro nezaměstnané v České republice

The article aims to analyse the effects of the start-up subsidy programme for unemployed in the Czech Republic, which is provided by the Ministry of Labour and Social Affairs. We explored to what extent participants in the programme in 2014 returned to unemployment three years after the end of the programme, i.e., 2014-2017. Methodologically, we conducted counterfactual impact analysis, where we matched participants in the programme with those who were not supported by any measures of active labour market policy. The results show that participants in the programme return to unemployment to a lesser extent. In total, they spent fewer days in unemployment during the follow-up period, and they returned to unemployment fewer times when compared with non-participants. Overall, 91.3% of participants never returned to unemployment during the analysed period. These results can be interpreted as a positive outcome of the programme. The article also offers implications for targeting the programme and for future research.

Modelovanie nákladov nezamestnanosti mladých absolventov na Slovensku: kontrafaktuálny prístup

The article deals with the modelling of the costs of unemployment of young jobseekers in Slovakia. This modelling used real data on young unemployed who participated in the intervention Contribution to the Graduate Practice, which is one of the measures of active labour market policy in Slovakia. The main objective of this study is to quantify the costs that have to be paid from the state budget of Slovakia for the unemployment of these young graduates. The analysis was performed using the counterfactual method of Propensity Score Matching, which was followed by a measurement of employability and sustainability of jobs after completing the intervention and the associated costs of the unemployment of the scheme participants and individuals in the control group during the intervention impact period. The results of this modelling indicate that although young graduates in the intervention are not able to repay the aid to the state budget on average, their participation in the intervention spared the state budget on average from almost 20% to 70% of the money spent on each unemployed individual. These results are important for policy-makers to set optimal terms of the intervention and the amount of grants provided so as to have the greatest impact on lowering the costs of unemployment of young graduates.

Active labour market policy use in Luxembourg: evidence from a firm survey

We analyse the use of active labour market policy (ALMP) measures by Luxembourg firms during the years of economic and financial crisis (2008–2009) and the subsequent European sovereign debt crisis (2010–2013). About 34% of Luxembourg firms used ALMPs between 2008 and 2013. Economy-wide, the use of ALMPs increased along both the extensive margin (more firms) and the intensive margin (more measures per firm). The likelihood that a firm hired with ALMPs is greater for firms that are large, multi-establishment, domestically oriented and firms facing strong demand and competition, with concerns about labour cost pressures.

The political economy of labor market deregulation during IMF interventions

ABSTRACT This study examines the relationship between policy interventions by the International Monetary Fund (IMF) and de jure labor rights. Combining two novel data sets with unprecedented country-year coverage – leximetric data on labor laws and disaggregated data on IMF conditionality – our analysis of up to 70 developing countries from 1980 to 2014 demonstrates that IMF-mandated labor market policy measures significantly reduce both individual and collective labor rights. Once we control for the effect of labor market policy measures, however, we find that collective labor rights increase in the wake of IMF programs. We argue that this result is explained by the impact of union pressure on governments which, in such a context, are imbued with the policy space to respond to domestic interest groups. The study has broader theoretical implications as to when international organizations are effective in constraining governments’ choices.

Spatial Interactions of Regional Labour Markets in Europe

This study investigates the spatial dependence of unemployment and employment rates in Europe relying on Eurostat NUTS2 level data for 306 European regions. Spatial dependence is explored using spatial error, spatial lag and a spatial autoregressive model with spatial autoregressive disturbances. The findings show that regional labour markets in Europe cluster in space – regions with high (low) (un)employment rate are surrounded by regions with high (low) (un)employment rate. The study provides evidence that significant spillovers across regional labour markets exist. The (un)employment rate in one region is directly affected by (un)employment rate changes in other regions, but also by unobserved shocks in other regions. It was found that the spatial effects are not determined by differences in the share of the population of youth, differences in industrial structure or difference in human capital. The results of the study confirm the importance of close coordination between regions while developing labour market and regional policy measures.